Which scenario would constitute price maintenance under competition rules?

• A. A retailer refuses to supply a product to a competitor due to its low prices
• B. A retailer offers price discounts to favored customers
• C. A retailer matches competitors' prices
• D. A retailer increases price uniformly

Answer: (A)

Price maintenance happens when a party in the distribution chain uses control over supply to keep prices from falling, typically by restricting which retailers can carry the product or by denying supply to those who discount. Refusing to supply a product to a competitor because that competitor is selling at lower prices is exactly using supply control to prevent price competition, thereby maintaining higher prices. The other scenarios involve discounting for some customers, price matching, or simply raising prices across the board without restricting which retailers can carry the product, so they don’t constitute price maintenance.